Business Highlights: Retail sales surge, faster rate hikes
January retail sales surge 3.8% as consumers defy inflation
NEW YORK (AP) — Fueled by pay gains, solid hiring and enhanced savings, Americans sharply ramped up their spending at retail stores last month in a sign that many consumers remain unfazed by rising inflation. Retail sales jumped 3.8% from December to January, the Commerce Department said Wednesday, a much bigger gain than economists had expected. Though inflation helped boost that figure, most of January’s gain reflected more purchases, not higher prices. Last month’s increase was the largest since last March, when most households received a final federal stimulus check of $1,400.
Fed: Faster rate hikes are likely if inflation stays high
WASHINGTON (AP) — Federal Reserve policymakers concluded last month that they would accelerate their tightening of credit if inflation failed to slow in the coming months. Most officials agreed that faster interest rate hikes would be needed “if inflation does not move down” as the Fed’s policymaking committee expects, according to the minutes of the central bank’s late January policy meeting. The minutes underscore the urgency that the Fed feels about reining in a sharp spike of inflation, which has persisted longer and broadened to more industries than the policymakers had expected. As recently as December, Fed officials forecast that inflation, based on their preferred measure, would fall to an annual rate of 2.6%.
High gas costs from Ukraine threat pose Biden political risk
WASHINGTON (AP) — While the Ukraine crisis presents the U.S. with a foreign policy threat, it’s also pushing gasoline prices higher at home. And that’s a growing political problem for President Joe Biden and fellow Democrats. With this year’s congressional elections in sight, inflation has become an albatross for the party. Biden wants to put the focus on how much the Russian threat on the Ukraine border is contributing to the gas price rise. But that message may be lost on Americans who just see how much fuel is costing at the pump. And Republicans are happy to put the blame on the Democrats.
European companies’ Russian ties could make sanctions tough
FRANKFURT, Germany (AP) — It’s not simple for Europe to plan sanctions against Russia in case it invades Ukraine. Sanctions would seek to maximize the pain for the Kremlin, its key banks and energy companies but also avoid jeopardizing the continent’s Russian-dependent energy supplies or inflicting too much damage on European companies with strong ties to Russia. Big European corporate names that do business in Russia include Germany’s Siemens AG, Italian tiremaker Pirelli and automakers like Volkswagen and Mercedes-Benz. Some European corporations have factories and major partnerships in Russia and hoping for a diplomatic solution. Some companies say their goals haven’t changed despite the tensions.
Stocks end mixed as traders parse next rate move by the Fed
NEW YORK (AP) — Stocks shook off an early slump and ended mixed on Wall Street Wednesday after minutes from the Federal Reserve’s latest meeting showed policymakers still leaning toward moving decisively to fight inflation. The S&P 500 wound up with a gain of 0.1%. The Dow Jones Industrial Average gave up 0.2% and weakness in some big technology companies pulled the Nasdaq down 0.1%. Small-company stocks rose. Treasury yields bounced around as traders tried to parse the latest update from the Fed. The 10-year Treasury yield wound up at 2.03%, just slightly below where it was late Tuesday. Crude oil prices rose.
Mexico’s avocados face fallout from violence, deforestation
MEXICO CITY (AP) — Mexico’s avocado producers have used clever Super Bowl ads, an irresistible fruit and apparently insatiable appetite from U.S. consumers to separate their product from the conflictive landscape that produces it. At least that was the case until a threat to a U.S. agricultural inspector essentially shut down Mexico’s exports last week. But as Mexican growers continue to suffer extortion from organized crime, and continue to chop down native pine forests to plant avocado orchards, another threat looms: campaigns for greener competition and perhaps even a boycott. Most advocates for more sustainable avocados stop short of calling for a boycott, but their patience is being tested.
DoorDash added users, surpassed sales forecasts in Q4
SAN FRANCISCO (AP) — DoorDash has posted better-than-expected sales for its fourth quarter thanks to its growing active-user base and an expansion of its delivery options. The San Francisco-based delivery company said its revenue grew 34% to $1.3 billion in the October-December period. That surpassed Wall Street’s forecast. DoorDash said its DashPass members __ who pay a monthly fee for unlimited free deliveries __ swelled to 10 million during the quarter, up from 9 million at the end of the third quarter. Total orders grew 35% to 369 million, also ahead of analysts’ expectations.
US accuses China of backing away from free-trade commitments
WASHINGTON (AP) — The United States has accused China of failing to meet its commitments to the World Trade Organization. It says will explore new ways to combat aggressive Chinese trade practices. In its annual report on Chinese compliance with WTO rules Wednesday, the Office of the U.S. Trade Representative says China isn’t keeping the promises it made to open its markets to foreign competition when it joined the 164-country Geneva-based agency in 2001. Among other things, the United States repeated longstanding accusations that China uses subsidies and regulations to favor its own companies at the expense of foreign competitors.
The S&P 500 rose 3.94 points, or 0.1%, to 4,475.01. The Dow Jones Industrial Average fell 54.57 points, or 0.2%, to 34,934.27. The Nasdaq dropped 15.66 points, or 0.1%, to 14,124.09. The Russell 2000 index of smaller companies gained 2.85 points, or 0.1%, to 2,079.31.